Why Are Goods That Are Non-Rivalrous and Excludable (Such as an Uncrowded

question 101

Multiple Choice

Why are goods that are non-rivalrous and excludable (such as an uncrowded library or art gallery) often provided by the government?

• A)Because when these goods are used beyond capacity,they would not be provided by private firms.
• B)The marginal cost to society of providing access to one more user is zero,so it is allocatively efficient to provide this good at a price of zero.
• C)Because the government can provide these goods with fewer resources,so it is productively efficient.
• D)The marginal private benefit to the last user is greater than the marginal private cost.
• E)The marginal benefit to society of providing access to one more user is zero,so it is allocatively efficient to provide this good at a price of zero.

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Definitions:

Deregulation

The process of removing or reducing government controls and restrictions in an industry to allow for more competition and efficiency.

Pork-Barrel Politics

The allocation of government spending for localized projects secured primarily to bring money to a representative's district, often without proper consideration of the benefits or costs.

Principal-Agent Problem

The principal-agent problem occurs when there is a conflict of interest between a principal (owner or shareholder) and an agent (manager or executive) due to differing goals, with the agent potentially making decisions that benefit themselves at the expense of the principal.

Public Choice

A branch of economics that studies the decision-making processes of government entities and its impact on economic policy.